Who Can Bill for Services When a Nurse Practitioner Is a Leased Employee?

Carolyn Buppert, NP, JD


August 08, 2006


If a hospital leases a nurse practitioner for inpatient services from a physician group and will not seek reimbursement for the in-hospital services, may the physician group bill for the NP services provided during the time he/she is leased to the hospital?

Response from the Expert

Carolyn Buppert, NP, JD 
Attorney, Private Practice, Annapolis, Maryland


This scenario is not one which allows for billing of a leased nurse practitioner's services by a physician group. If a hospital leases a nurse practitioner from a physician group, the hospital could bill for the nurse practitioner's services. Or, if a physician group leases a hospital-employed nurse practitioner from a hospital, then the physician group may bill the nurse practitioner's services, when the nurse practitioner provides physician services to hospitalized patients. It is the entity employing the nurse practitioner, whether by W-2 employment or lease, that has the opportunity to bill for the nurse practitioner's services.

There is an exception, however. If a physician group employs a nurse practitioner full-time, and leases the nurse practitioner to a hospital for .5 FTE, then the physician group still employs the nurse practitioner half-time and could bill for the physician services provided by the nurse practitioner to hospitalized patients.

It is important to note that there is no specific statement by Medicare that approves the billing of leased employees' services in the hospital setting. However, the Center for Medicare and Medicaid Services (CMS) made it clear in 2003 that a physician could bill, in the office setting, under the incident-to rules, the services of a leased employee who is a nurse practitioner.[1] Incident-to billing is not applicable to the hospital setting. However, in 2003, CMS published rules on billing "shared visits" that apply to the hospital setting and are similar to the rules on incident-to billing. Both sets of rules accomplish the same objective (ie, they allow employers to bill for the services of physician-nurse practitioner teams).

The rules on shared billing do not specify a type of employment arrangement, but simply say "When a hospital inpatient/hospital outpatient or emergency department evaluation/management is shared between a physician and a non-physician practitioner from the same group practice [my emphasis] and the physician provides any face-to-face portion of the evaluation/management encounter with the patient, the service may be billed under either the physician's or the non-physician practitioner's UPIN/PIN number. However, if there was no face-to-face encounter between the patient and the physician (eg, even if the physician participated in the service by reviewing only the patient's medical record) then the service may only be billed under the non-physician practitioner's UPIN/PIN. Payment will be made at the appropriate physician fee-schedule rate based on the UPIN/PIN entered on the claim."[2]

It is reasonable to assume that a leased employee would be "from the same group practice." And, it is reasonable to assume that if CMS thinks it appropriate to bill a leased employee's services in the office setting, then it would be appropriate to bill a leased employee's services in the hospital setting.


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